Rights Issue December 2019

The Board of Directors of Minesto AB ("Minesto" or "the Company") has decided to carry out a rights issue of up to 6,084,133 units at a subscription price of SEK 14.12 per unit (the “Rights Issue "), based on the authorization given by the annual general meeting on June 4, 2019. 

The Rights Issue is carried out in order to give the existing shareholders of the Company the opportunity to subscribe for new shares in the Company under the same conditions as in the private placement of units of approximately SEK 60 million (the "Directed Issue") that Minesto completed in October 2019.

The Directed Issue and the Rights Issue enable Minesto to accelerate the commercialization of the Company's technology, at the same time as resolved publicly funded projects can be realized. Further, it provides Minesto with financial resources for the foreseeable future in order to facilitate the expansion to the first large-scale commercial farms.

The Rights Issue in short

  • One (1) share entitles the holder one (1) subscription right, and sixteen (16) subscription rights entitle subscription to one (1) unit.
  • One (1) unit contains one (1) share and one (1) warrant.
  • The subscription price is SEK 14.12 per unit.
  • The subscription rights which will be assigned to Midroc New Technology AB will be discarded in accordance with the principle communicated in connection with the Directed Issue. This results in total proceeds of approximately SEK 86 million before transactions costs, provided that the Rights Issue is fully subscribed.
  • The expected subscription period runs from 4 December 2019 until 18 December 2019.
  • The expected record date for the detachment of the subscription rights in the Rights Issue is 2 December 2019.
  • The subscription period for the warrant included in the unit will expire on 30 April 2021. Each warrant gives the holder the right to subscribe for one (1) new share in the Company. For information on the subscription price for the warrant, see “Terms for the Rights Issue” below.
  • The prospectus for the Rights Issue is expected be published on or about 3 December 2019. The indicative time table below assumes that the prospectus is published within the stated time.
  • Minesto's largest shareholder, BGA Invest AB, has committed to subscribe for units to a total value of SEK 20 million in the Rights Issue, corresponding to approximately 23 percent of the total number of units in the Rights Issue.

Indicative time table of the Rights Issue (dates refer to 2019 if not mentioned otherwise)

28 November: Last day of trading in the Minesto share with the right to participate in the Rights Issue

2 December: Record date. Shareholders who are registered in the share register on this day will receive subscription rights for participation in the Rights Issue

3 December: Estimated date for publication of the prospectus

4 – 16 December: Trading in subscription rights

4 – 18 December: Subscription period

4 December  – 10 January 2020: Trading in paid subscribed shares (Sw. betald tecknad aktie, BTA)

On or about 20 December: Announcement of the outcome of the Rights Issue

Background and reasons

In connection with Minesto’s completion of the Directed Issue on 28 October 2019, the Company also announced its intention to carry out a rights issue of identical units in order to give existing shareholders the opportunity to subscribe for new shares in Minesto on the same terms as in the Directed Issue, and thus maintain their relative shareholding in relation to Midroc New Technology AB.

With the capital injection from the Directed Issue, the cash position is estimated to be sufficient to finance the Company’s working capital requirement during the coming twelve-month period. The Rights Issue is expected to raise proceeds of approximately SEK 86 million to the Company, before transaction costs, which are expected to amount to approximately SEK 4 million. Assuming the completion of the Rights Issue, the net proceeds will be distributed according to the following order of priority and scope:

  • Completion, further development and expansion of the first production facilities in the Company's current projects in the UK, the Faroe Islands, Taiwan and France (approximately 60 percent); and
  • Other product and market development activities focusing on customer collaboration and installation projects (approximately 40 percent).

Upon full exercise of all the warrants in the Directed Issue and the Rights Issue, and provided that any conversion of the subscription price is not carried out in accordance with current conditions, the Company will receive additional proceeds of approximately SEK 201 million, before transaction costs, no later than April 30, 2021. The Company intends to use the net proceeds from the warrants according to the following order of priority and scope:

  • Enable the expansion of the first large-scale commercial parks, partly through initial project investments in-house and in combination with external parties, and partly to ensure the Company's capacity to deliver products (approximately 70 percent); and
  • Other product and market development activities (about 30 percent).

The transaction costs for the Directed Issue, the Rights Issue and the exercise of warrants are estimated to amount to approximately SEK 12 million in total, upon full subscription.

Terms for the Rights Issue

Shareholders registered in the share register kept by Euroclear Sweden AB on 2 December 2019 have the right to subscribe for units in relation to the previous holdings of shares. One (1) held share as of this date entitles one (1) subscription right and sixteen (16) subscription rights entitle one (1) unit. One unit contains one (1) share and one (1) warrant (TO3).

In addition, investors are offered the opportunity to subscribe for units without the support of subscription rights.

In the event that not all units are subscribed for by subscription rights, the Board of Directors shall, within the frame for the maximum amount of the Rights Issue, decide on allocation of units subscribed for without the support of subscription rights. In that case, units shall: (i) first be allocated to those who have also subscribed for units with subscription rights, whether or not they were shareholders on the record date, pro rata in relation to the number of subscription rights that has been used for subscription; (ii) second, be allocated to others who have expressed interest to subscribe for units without subscription right, pro rata in relation to their registered interest, and, to the event that this cannot be done, by lottery.

Subscription of units supported by subscription rights shall be made by cash payment from 4 December 2019 up until 18 December 2019. Application for subscription of units without support of subscription rights shall be made in a specific application form during the same period. Payment for units subscribed for without support for subscription rights shall be made in accordance with the instructions in the settlement note which will be sent to those who receive allocation. The Board of Directors of the Company reserves the right to extend the subscription period and the time for payment under all conditions. Such extension shall be announced no later than the last day of the subscription period and published by the Company.

Full subscription in the Rights Issue implies that the number of shares in the Company increases from 119,471,630 shares to 125,555,763 shares, which corresponds to a dilution of approximately 4.8 percent of the number of shares and the votes in the Company. Upon full exercise of the warrants in the Directed Issue and the Rights Issue, the number of shares will increase by 10,333,423 to a maximum of 135,889,186 shares, corresponding to a dilution of approximately 7.6 percent of the number of shares and the votes in the Company.

The strike price for the warrant will be set to the lower of (i) SEK 19.42 or (ii) the volume weighted average price of the Company’s share on the trading day following the record date for the detachment of the subscription rights in the Rights Issue multiplied by 1.10.

Furthermore, should the subscription price for the warrant be more than 10% higher than the volume weighted average price during the period April 20–30, 2020, the subscription price will be reset to the volume weighted average price during the period April 20–30, 2020, with an addition of 10 percent. However, the strike price for the warrant can never be less than SEK 9.71.

Prospectus

A prospectus with full terms and conditions regarding the Rights Issue will be available prior to the start of the subscription period on Minesto's website (www.minesto.com), Pareto Securities' website (www.paretosec.se) and Aktieinvest's website (www.aktieinvest.se).

Advisor

Pareto Securities AB is the financial advisor and MAQS Advokatbyrå is the legal advisor in connection with the Rights Issue.